Contrasting Amalgamated Financial (NASDAQ:AMAL) & Barings Bdc (NYSE:BBDC)

Barings Bdc (NYSE:BBDC) and Amalgamated Financial (NASDAQ:AMAL) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, earnings, dividends and risk.

Profitability

This table compares Barings Bdc and Amalgamated Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Barings Bdc	35.67%	9.76%	4.26%
Amalgamated Financial	22.97%	14.97%	1.31%

Institutional and Insider Ownership

44.1% of Barings Bdc shares are owned by institutional investors. Comparatively, 75.9% of Amalgamated Financial shares are owned by institutional investors. 0.5% of Barings Bdc shares are owned by company insiders. Comparatively, 1.3% of Amalgamated Financial shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Barings Bdc pays an annual dividend of $1.04 per share and has a dividend yield of 11.5%. Amalgamated Financial pays an annual dividend of $0.56 per share and has a dividend yield of 2.0%. Barings Bdc pays out 108.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Amalgamated Financial pays out 16.9% of its earnings in the form of a dividend. Barings Bdc has raised its dividend for 3 consecutive years and Amalgamated Financial has raised its dividend for 4 consecutive years.

Volatility & Risk

Barings Bdc has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500. Comparatively, Amalgamated Financial has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Barings Bdc and Amalgamated Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Barings Bdc	0	2	2	0	2.50
Amalgamated Financial	1	1	1	0	2.00

Barings Bdc currently has a consensus target price of $9.67, indicating a potential upside of 7.10%. Amalgamated Financial has a consensus target price of $33.00, indicating a potential upside of 19.96%. Given Amalgamated Financial’s higher possible upside, analysts plainly believe Amalgamated Financial is more favorable than Barings Bdc.

Earnings & Valuation

This table compares Barings Bdc and Amalgamated Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Barings Bdc	$112.89 million	8.41	$110.29 million	$0.96	9.40
Amalgamated Financial	$434.51 million	1.91	$106.43 million	$3.32	8.29

Barings Bdc has higher earnings, but lower revenue than Amalgamated Financial. Amalgamated Financial is trading at a lower price-to-earnings ratio than Barings Bdc, indicating that it is currently the more affordable of the two stocks.

Summary

Amalgamated Financial beats Barings Bdc on 9 of the 17 factors compared between the two stocks.

About Barings Bdc

Barings BDC, Inc. is a publicly traded, externally managed investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. It seeks to invest primarily in senior secured loans, first lien debt, unitranche, second lien debt, subordinated debt, equity co-investments and senior secured private debt investments in private middle-market companies that operate across a wide range of industries. It specializes in mezzanine, leveraged buyouts, management buyouts, ESOPs, change of control transactions, acquisition financings, growth financing, and recapitalizations in lower middle market, mature, and later stage companies. It invests in manufacturing and distribution; business services and technology; transportation and logistics; consumer product and services. It invests in United States. It invests in companies with EBITDA of $10 million to $75 million, typically in private equity sponsor backed.

About Amalgamated Financial

Amalgamated Financial Corp. operates as the bank holding company for Amalgamated Bank that provides commercial and retail banking, investment management, and trust and custody services for commercial and retail customers in the United States. The company accepts various deposit products, including non-interest bearing accounts, interest-bearing demand products, savings accounts, money market accounts, NOW accounts, and certificates of deposit. It also provides various commercial loans comprising commercial and industrial, multifamily mortgage, and commercial real estate loans; residential mortgage loans; and retail loans, such as residential real estate, consumer solar, and consumer and other loans. In addition, the company offers online banking, bill payment, online cash management, and safe deposit box rental services; debit and ATM cards; and trust, custody, and investment management services comprising asset safekeeping, corporate actions, income collections, proxy, account transition, asset transfers, and conversion management services. Further, it provides investment products, such as funds spanning equity, fixed-income, real estate, and alternative investment products; and brokerage, asset management, and insurance products. Amalgamated Financial Corp. was founded in 1923 and is headquartered in New York, New York.